By Brazil Stock Guide — B3 (B3: B3SA3), the operator of Brazil’s main stock exchange, reported a 30.5% increase in third-quarter net profit to R$1.63 billion ($), supported by higher revenue and a tax benefit linked to an extraordinary distribution of interest on equity, a tax-efficient form of shareholder remuneration widely used in Brazil.
Recurring net profit, which excludes one-off items, rose a more modest 9.9% to R$1.38 billion. The gap between the two figures largely reflects a R$277.5 million tax benefit associated with the extraordinary shareholder distribution, which helped lift reported earnings.
Total revenue reached R$3.07 billion, up 11.1% from a year earlier, while net revenue increased 11% to R$2.76 billion. Growth was driven by stronger equity trading activity, an expanding fixed-income market and higher contributions from technology and data services.
Average daily trading value in the cash equity market climbed 25.4% to R$27.3 billion. Trading in individual stocks rose 26.1%, while volumes in Brazilian Depositary Receipts (BDRs), which provide exposure to foreign securities, and listed funds surged 63.6% and 62.9%, respectively.
Despite higher overall trading activity, B3 faced pressure on derivatives revenue. Average daily volume increased 7% to 9.9 million contracts, but revenue from the segment declined 3.2% to R$859.2 million. Average revenue per contract fell 10.3%, reflecting changes in the trading mix and lower average fees.
Brazil’s fixed-income market continued to expand. For the first time, the outstanding value of fixed-income instruments registered with B3 exceeded R$10 trillion. The average outstanding balance of corporate bonds, known locally as debêntures, rose 17.6%, while assets held through Tesouro Direto, Brazil’s retail government bond investment platform, increased 42.9%.
B3’s more recurring revenue streams also gained ground. Its Technology and Platforms division generated R$557 million in revenue, up 16.3%, while Capital Markets Solutions revenue jumped 29.9% to R$210.1 million, supported by growing demand for financial data and market intelligence products.
Operating expenses, however, rose 17.4% to R$987 million, outpacing revenue growth. Adjusted expenses increased 7.5%. B3 attributed the rise partly to technology investments, changes in the billing structure of certain services and provisions related to legal disputes.
Recurring earnings before interest, taxes, depreciation and amortization (EBITDA) reached R$1.9 billion, up 9%, with a recurring EBITDA margin of 68%.
Net financial income rose to R$110.1 million from R$61.4 million a year earlier. Meanwhile, income tax and social contribution expenses fell 43.6% to R$260.2 million. The effective tax rate declined to 13.8% from 26.3%, largely reflecting the extraordinary interest-on-equity distribution.
During the quarter, B3 returned R$1.51 billion to shareholders, including R$1.13 billion in interest on equity and R$383 million through share buybacks. The company repurchased 24.6 million shares during the period.
B3 also expanded its product portfolio with the launch of U.S. Treasury futures and new cryptocurrency-linked derivatives. On the acquisition front, it completed the purchase of CRDC, a company operating in Brazil’s emerging electronic trade receivables market, and announced an investment in IDEX Analytics, a provider of fixed-income data and analytics, subject to regulatory approval.
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